1.

Quicksand Company has set the following standards for one unit of product:

Direct material
Quantity: 6.2 pounds per unit
Price per pound: $11 per pound
Direct labor
Quantity: 6 hours per unit
Rate per hour: $23 per hour

Actual costs incurred in the production of 2,800 units were as follows:

Direct material: $194,350 ($11.50 per pound)

Direct labor: $393,750 ($22.50 per hour)

All materials purchased were consumed during the period.

Required:
Calculate the direct-material price and quantity variances and the direct-labor rate and efficiency
variances. Indicate whether each variance is favorable or unfavorable.

2. Hermosa Enterprises recently experienced a fire, forcing the company to use incomplete
information to analyze operations. Consider the following data and assume that all materials
purchased during the period were used in production:

Direct materials:
Standard price per pound: $9
Actual price per pound: $8
Price variance: $20,000F
Total of direct-material variances: $2,000F

Direct labor:
Actual hours worked: 40,000
Actual rate per hour: $15
Efficiency variance: $28,000F
Total of direct-labor variances: $12,000U

Hermosa completed 12,000 units.

Required:
Determine the following: (1) actual materials used, (2) materials quantity variance, (3) labor rate
variance, (4) standard labor rate per hour, and (5) standard labor time per finished unit.

3. Taylor Company applies overhead based on direct labor hours and has the following available
for November:

Standard:
Direct labor hours per unit 5
Variable overhead per DLH $.75
Fixed overhead per DLH
(based on 8,900 DLHs) $1.90
 Actual:
Units produced 1,800
Direct labor hours 8,900
Variable overhead $6,400
Fixed overhead $17,500

a. Refer to Taylor Company. Compute all the appropriate variances using the two-variance approach.
b. Refer to Taylor Company. Compute all the appropriate variances using the three-variance approach.
c. Refer to Taylor Company. Compute all the appropriate variances using the four-variance approach.

4. The following information is available for Whitestone Company for the current year:

Standard:
Material X: 3.0 pounds per unit @ $4.20 per pound
Material Y: 4.5 pounds per unit @ $3.30 per pound
Class S labor: 3 hours per unit @ $10.50 per hour
Class US labor: 7 hours per unit @ $8.00 per hour

Actual:
Material X: 3.6 pounds per unit @ $4.00 per pound (purchased and used)
Material Y: 4.4 pounds per unit @ $3.25 per pound (purchased and used)
Class S labor: 3.8 hours per unit @ $10.60 per hour
Class US labor: 5.7 hours per unit @ $7.80 per hour
Whitestone Company produced a total of 45,750 units.

a. Refer to Whitestone Company. Compute the material price, mix, and yield variances (round to the
nearest dollar).
b. Refer to Whitestone Company. Compute the labor rate, mix, and yield variances (round to the nearest
dollar).